Meritage Portfolio Management    

About Us

Meritage Portfolio Management, advisor to the Funds, was founded in 1991. The firm provides separate account management of equity and balanced portfolios for institutions and private clients. In late 2013 Meritage launched mutual funds based on its three equity strategies: Value, Growth and Yield-Focus.

We are independently owned and located in the Kansas City metro area. As a testament to our conviction and commitment, we invest the firm’s money alongside that of our clients. In addition, there has been no turnover on our investment team in over 10 years.

Our Investment Philosophy

Immediately following are observations and beliefs common to all three of our equity strategies: 

  • Stock prices are more volatile than the underlying business valuations. These pricing inefficiencies are caused by a variety of factors, such as investor emotion and short-term thinking, and they create good investment opportunities for disciplined investors grounded in value-centric principles. In other words all known information is not “efficiently” priced into stocks, including companies in the large cap universe, and skillful investors can benefit accordingly.

  • Quantitative methods can be highly effective in identifying mispriced stocks by codifying beliefs, evaluating a broad universe of securities and protecting against emotion and biases. Markets are too broad and complex to approach unsystematically.

  • All disciplines have their limitations and as helpful as a quantitative framework is, not all relevant security information can be captured and evaluated with these processes. We believe the best investment results will therefore be achieved by including a complementary qualitative analysis as part of the security selection process.

  • The use of non-U.S. securities allows us to expand our opportunity universe and potentially take advantage of value dislocations in foreign markets. 

  • Principles of valuation are essential in evaluating securities, regardless of the investment style. It’s important to distinguish between good companies and good buys.

The following additional belief is specific to the Meritage Yield-Focus Equity strategy:

  • The search for equity yield should include a variety of non-standard equity structures (MLPs, REITs, and business development companies) as a means of enhancing returns and diversifying risk.

Investment Process

Idea Generation

  • Because markets are complex, the investment team favors a systematic, quantitative approach to identify buy candidates.
  • Our approximate 6,500 common stock universe is screened every week using our Value and Growth models.
  • The Value model is comprised of 32 factors spread over four categories - valuation, business momentum, investor sentiment and management IQ.
  • The Growth model is comprised of 44 factors spread over five categories – growth, valuation, business momentum, investor sentiment and management IQ. 
  • Cap size and quality hurdles reduce the list to approximately 3,500 stocks. These are first ranked highest to lowest and then scored 1 to 100 (1 being the best) in a normal distribution or bell curve. Stocks scored 20 or better – generally 3% of the working universe, or about 200 stocks – are candidates for purchase.


  • Our follow-on qualitative work is primarily a risk control step and is a delicate balance between preserving the value of our quantitative conclusions and identifying unique variables that cannot be captured through systematic analysis. Our methods focus on a detailed review of the individual quantitative results, along with independent, single-stock proprietary research.

Sell Decision

  • The majority of our sell decisions are based on declines in our quantitative process ranking, mostly due to price appreciation that reduces projected returns. The scores may also deteriorate for reasons other than price, such as a change in factor rankings due to business deterioration.
  • The remaining sales are generally based on risk control activities – reducing oversized positions, sector exposure considerations and stop-loss procedures.

Diversification does not ensure a profit or guarantee against loss.

Given the significant differences between separately managed accounts and mutual funds, investors should consider the differences in expenses, tax implications and the overall objectives between separately managed accounts and mutual funds before investing. Past performance of the strategy/separately managed account is not indicative of future performance of the fund.

Small-Cap investing involves greater risk not associated with investing in more established companies, such as greater price volatility, business risk, less liquidity and increased competitive threat.

Foreign investments, including ADRs, are subject to sovereign risk and may be adversely affected by changes in currency exchange rates, future political and economic developments, and the possible imposition of exchange controls or other foreign governmental laws or restrictions.

BDCs are publicly-traded closed-end funds that seek capital appreciation and income by investing in smaller companies during their initial stages of development. With respect to investments in BDCs, the Fund plans to invest only in publicly traded BDCs. A BDC may invest in the equity and debt securities of smaller and developing companies as well as companies that are experiencing financial crises (“Portfolio Companies”).  Investments in smaller and developing Portfolio Companies involve a greater risk of loss due to their youth and limited track records and are more susceptible to competition and economic and market changes due to limited products and market shares. 

MLPs, also known as publicly traded partnerships, predominately operate, or directly or indirectly own, energy-related assets. MLPs are subject to certain risks inherent in the structure of MLPs, including complex tax structure risks, limited ability for election or removal of management, limited voting rights, potential dependence on parent companies or sponsors for revenues to satisfy obligations, and potential conflicts of interest between partners, members and affiliates.

REITS are companies that pool investor funds to invest primarily in income producing real estate or real estate related loans or interests. Investors should be aware of the risks involved with investing in REITs and real estate securities, such as declines in the value of real estate and increased susceptibility to adverse economic or regulatory developments.

Read Manager Bios

7500 College Blvd., Suite 1212, Overland Park KS 66210, Tel 913-345-7000. © Meritage Funds. All rights reserved.

Past performance is no guarantee of future results. The investment return and principal value of an investment in the Funds will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost.

Investors should carefully consider the investment objectives, risks, charges and expenses of the Meritage Mutual Funds. This and other important information about the Funds is contained in the Prospectus, which can be obtained by calling Shareholder Services at (855) 261-0104. The Prospectus should be read carefully before investing.

Distributed by Unified Financial Securities, LLC. (Member, FINRA)